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Apple May Be Bringing 7″ iPad To Compete With Kindle Fire

Could Apple be feeling a bit threatened by the arrival of the impressively popular Kindle Fire? If certain rumors coming out of Taiwan are true, then the answer seems to be “Yes”.

The most recent set of rumors, which as always should be taken with a grain of salt, indicate that Apple has been looking at samples of 7.85″ screens. Presumably this would be an effort to design something along the lines of a budget iPad to compete with the sudden wave of affordably priced iPad alternatives hitting the market. Such a device would have the advantage of Apple’s excellent reputation and superior presence in the tablet market while also allowing purchase by customers who aren’t quite ready to drop $500+ for their newest piece of narrowly useful electronics.

This would not exactly fit with prior declarations from Apple regarding the usefulness of a 7″ tablet, of course. Steve Jobs came out emphatically against such devices, declaring that extensive testing had shown anything smaller than the iPad to deliver a sub-par user experience when using fingers as pointing devices. This doesn’t rule a smaller iPad out entirely, though. One, with the passing of Steve Jobs his company will naturally have to choose their own course. If the market demands smaller, more affordable tablets then there is every reason to believe that Apple will rise to the challenge. Two, Apple does have some history of declaring things pointless or unfeasible right up until the moment they feel they are in a position to do those very things. Whether this is due to clever PR trying to throw off the competition or simply Apple’s desire to give their customers what they want regardless of what seems to be a smart move at first is open to interpretation.

Clearly nothing is set in stone yet. At best, somebody at Apple thinks that the idea of a smaller iPad is something that should be explored to some extent. As far as anybody knows, orders have not been placed and plans have not been made. We have more substantial speculative information floating around about the iPad 3 than this, by a fair margin. Even if it did happen, would it really be able to outshine the competition anymore?

A smaller iPad competing with the Kindle Fire would almost certainly come in at $250-300 and be unavailable until at least mid-2012. Where Amazon is pushing media, Apple is making most of their profit on the hardware end and would have to scale back the power of their device accordingly, likely eliminating a great deal of their edge along those lines. On top of that, the Kindle Fire will have had time to gain a following. Assuming that the real value is in the content that a tablet has access to, Amazon is certainly offering enough to keep their users happy and the low price is clearly attractive.

We’ll see what happens in the months to come, but I question the potential for a move like this. Apple already controls the performance tablet market and would be better off without a disappointment on the budget tablet end of things.